WASHINGTON—President
Barack Obama
played down the possible economic benefits of the Keystone XL pipeline, saying it would have very little impact on U.S. consumers.

“Keystone is not American oil. It’s Canadian oil that is wrung out of tar sands in Canada,” Mr. Obama said, speaking to reporters at the White House on Friday.

“It would save the Canadian oil companies and the Canadian oil industry an enormous amount of money if they could simply pipe it all the way through the United States down to the Gulf,” Mr. Obama said.

More

The State Department has been under pressure to act on the proposed pipeline, which would transport Canadian crude oil to the Gulf Coast.
TransCanada Corp.
of Calgary, Alberta, in 2008 submitted an application to receive a needed permit from the State Department, which reviews cross-border pipelines.

Mr. Obama said that once in the Gulf Coast, the oil wouldn’t help make American oil prices cheaper but would instead be sold and shipped abroad.

“It’s not going to be a huge benefit to U.S. consumers. It’s not even going to be a nominal benefit for U.S. consumers,” Mr. Obama said.

Mr. Obama didn’t give any indication when his administration might reach a decision on the pipeline.

During a visit to the province of Alberta, home to the oil sands, Canadian Ambassador to the U.S. Gary Doer criticized the delay in deciding the fate of the Keystone XL pipeline. He said it would be akin to “environmental malpractice” for more crude oil to be shipped to the U.S. via diesel-powered trains.

“To have massive amounts [of oil] on rail because we won’t approve a pipeline borders on environmental malpractice,” Mr. Doer said at a news conference in Calgary on Friday.

Mr. Doer also said a drop in crude prices won’t impact the Keystone XL pipeline, saying heavy oil refineries on the U.S. Gulf Coast still need Canadian crude.